The building will overlook the Western coastal city's famous fjords. The project seeks to promote sustainable materials while at the same time boosting Norway’s vast forestry industry, the Agriculture Ministry said on Thursday.

"The biggest challenge in building a 14-story wooden building is preventing big swings amid strong wings," BOB said in an earlier statement.

The building, complete with a rooftop terrace, a Japanese garden, an indoor patio, a glass facade and views of the fjord, could be ready for sale by early 2014.

It would be constructed from prefabricated modules to cut down construction time, reinforced by diagonal timber structures for stability.

BOB said it hoped the pilot building would allow it to perfect the manufacturing process for further construction.

In 2011, Norway cut down 8.6 million cubic metres of industrial roundwood for 3.1 billion crowns ($518.33 million). Its entire forestry industry generated revenue of 44 billion crowns a year earlier, the latest period for which data was available.